Title: Internationalization of the KARAM Group of Companies: Experiences, Imperatives and Challenges
Abstract: Statistics from the Organization for Economic Cooperation and Development indicate that Small and Medium Enterprises account for a substantial proportion of exports from most developing nations. But little is known about the effect of having an international entrepreneurial orientation, or the role of specific strategies associated with it. Encapsulated here is the case of an Indian enterprise manufacturing personal protective equipment that grew from a team of four into a 2500-member organization, with its zeal for quality and innovation. It charts the organization's international entrenchment over15 years by adopting and adapting to the environment. Highlights how it established corporate governance practices, mentored leaders and grew in stature and profitability. Transformation of product range from Low-Tech (safety nets and traffic cones) to High-Tech (exhaustive range of personal protective equipment) has been chronicled. Findings indicate that 'Brand India' needs to improve its perception through commitment to quality.Key Words: Adapting, Adopting, Brand, International, TransformationINTRODUCTIONSmall and Medium Enterprises (SMEs) have begun to play a critical role in international trade. Statistics from the Organization for Economic Cooperation and Development (OECD) indicate that SMEs now account for a very substantial proportion of exports from most developing nations. But very little is known about the effect of having an international entrepreneurial orientation, or the role of specific strategies associated with this, on the foreign performance of such firm.Business Internationalization is becoming an important precondition for further growth and development (Paunovic and Prebezac, 2010).It was found that two sets of factors propel entrepreneurs towards the international markets:1. Those stemming from domestic environment such as uncertainty and instability, strong competition, lack of foreign exchange, etc.; and2. Strong interes t and willingness of the entrepreneur towards internationalization (Ahroni 1999; and Ghanatabadi, 2005).Internationalization is not be considered as a separate part of the company or as a strategy to be enacted only in times of reduced local demand, but fully integrated into the SME as a core part of the company's long term strategy. This is reinforced by the fact that internationalization has been proved to be one of the key engin es for competitiveness and growth (Directorate-General for Enterprise and Industry, 2007).THE CURRENT INDIAN SCENARIOMicro, Small and Medium Enterprises (MSMEs) play a significant role in the global economy and particularly in India where they constitute nearly 94% of the industrial enterprises in the country. The Sector contributes 36% of the total value of the exports of the country and employs over 80 million people. The contribution of this sector to the output of the country is 40% and to the GDP is over 8%. In recent years the MSME sector has consistently registered higher growth rate compared to the overall industrial sector (Grant Thornton India LLP and FICCI, 2013). Now as the world is increasingly being considered a global village, companies who do not capitalize on the benefits of internationalization may soon have to lose out to competition.International economy is exposed to powerful globalization processes and a rapid introduction of IT technologies. It is frequently said that the enterprises reluctant to internationalize their business can have no long-term prospects in any modern economy (Ridderstrale and Nordstrom, 2002). Rather than being reactive or defensive, a wise marketer must shed rigid mentality and embrace a more progressive and flexible view of the world market. Potential problems can thereby be transformed into challenges and opportunities (Onkvisit and Shaw, 2009). Exhibit 1 demonstrates the role of MSMEs in the Indian economy.In view of the given figures it is estimated, that since the MSME sector is thriving in the domestic market, by going global it will add to foreign exchange earnings for the nation and help these organizations grow in stature, giving them economies of scale, release sources of better and cheaper raw material, generate multiple revenue streams and accrue other added benefits. …
Publication Year: 2015
Publication Date: 2015-04-01
Language: en
Type: article
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Cited By Count: 3
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